China's Steel Output Cut to Continue Through 2010, Industry Ministry Says

Steel production cuts by China, the world’s largest maker of the alloy, will probably continue to the end of the year because of limited power supply to the mills, the industry ministry said.

Crude steel output in the nation is expected to reach as much as 630 million metric tons this year, Luo Tiejun, deputy director general of the raw material department at the Ministry of Industry and Information Technology, said today at a conference in Shanghai. He didn’t give comparative numbers. The cuts are aimed at meeting energy efficiency targets, he said.

China started restricting power to mills this month and will accelerate measures to boost energy efficiency in the fourth quarter, according to Goldman Sachs Group Inc. Hebei Iron & Steel Co., the listed unit of China’s biggest steelmaker, said yesterday three of its units will cut a combined 1.5 million tons of output starting this month through December.

China’s steel products exports may be 40 million tons this year, Luo said, without giving a year-ago comparison.

--Alfred Cang, with assistance from Xiao Yu in Beijing. Editors: Indranil Ghosh, Tan Hwee Ann

To contact the Bloomberg News Staff of this story: Alfred Cang at acang@bloomberg.net

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